Have a few questions. Please help

[bcglobal]

Hi,
I'm trying to decide if a 13 is the best option for me but I have a few questions. I live in California, and have a house that is upside down. I'm looking to get rid of the 2nd mortgage (155K lien strip) and about 70k in unsecured debt.

I just have a few questions.

1) If I should lose my job within the 5 years, could I use ROTH IRA assets to pay the trustee and satisfy my 13?

2) Is there a minimum amount of disposable income to qualify for a 13?

[klandsb]

As I have read in many post if you are in a 100% payback plan you can pay it off early . If not, no you are not permitted to pay it . Also, do not spend your ROTH IRA to pay off debts. You will need that someday to retire with
Yes, there is a mininum amount. I believe its somewhere around $ 170- $180... I am sure another more experienced member will chime in...
Your best bet is to make appts and go to a few attorney's for "free consults". they cant tell you exactly what you would be paying and they wont make it a long detailed meeting because "its free" but you will get an idea if this is something you want to explore further...
Also I have spent hours on this site reading other threads and the stickies trying to educate myself . In fact my attorney got huffy with me one day and stated : "since you know so much about bk maybe you should represent yourself "... No I am not even close to ever doing something like that but I do know enough to know he was not looking out for my best interest. And he seems alot better now

[lrprn]

1) If I should lose my job within the 5 years, could I use ROTH IRA assets to pay the trustee and satisfy my 13?

Only if your plan was already paying 100% to your creditors. If your plan is paying less (and the vast majority do), so far the courts have decided that to pay off a Ch 13 early, you must pay your unsecured creditors that made claims100% of those claims.

As already wisely stated, using your ROTH to do this is not good long-term financial planning. If you lose your job, you wait until your income over the last six months falls below your state's median income, then you have your lawyer flip your case over to Ch 7. Unfortunately this won't help strip your second mortgage.

2) Is there a minimum amount of disposable income to qualify for a 13?

In most cases when an experienced bk lawyer has prepared your Means Test and Schedules, if you show less than about $110/month disposable income, you can't support an ongoing Ch 13 plan. It's also unlikely that your creditors can get what they would get if you filed Ch 7.

If you show more than about $180/month disposable income, then it's likely you can support a Ch 13 plan and chances are your trustee or the US trustee will push to move you from Ch 7 into Ch 13.

If you show between $110 and $180/month disposable income, then it's a toss-up that depends on the specific financial circumstances in your case whether you can qualify for Ch 7 or Ch 13.

[optimistic1]

If you have a 60 month plan, even if you qualify for a 36 month plan, and you have disposable income of $100, thats $6000 to pay towards claims. Several forum members here have very small payments, so the notion that it needs to be X amount is really just an assumption. It depends on the type of debts that you have, and the type of assets you are trying to protect, if they are not exempt. Lots of people just pay the attorney fees and their trustee fee in their plan. It is definitely possible, but highly inprobable.